New York (CNN) Netflix on Tuesday said it will expand its paid account sharing option in the second quarter, after delaying it in the previous quarter.
Netflix started restricting password sharing Four additional countries earlier this year, but chose not to expand more broadly after “identifying sufficient growth opportunities” from early launches.
The late timing of the company’s latest earnings results may have added to the company’s challenges in growing its subscriber base in the March quarter.
The company reported a net increase of 1.75 million global streaming subscribers, up nearly 5% from the same period a year earlier, but below Wall Street analysts’ expectations of more than 3 million.
Netflix said it saw a “cancellation reaction when we announced the news in every market” about the pay-sharing option, but it sees “increased acquisition and revenue.” However, by delaying the release, Netflix said that “some of the expected membership growth and revenue benefits will be less in Q3 than in Q2.”
Tuesday’s earnings report marks the first for new co-CEOs Greg Peters and Ted Sarandos since founder Reed Hastings. handed over over the stake and became executive chairman in January.
It was an important quarter for Netflix, as the company seeks to develop several new revenue opportunities following last year’s rocky performance. That prompted a big selloff, including shedding 200,000 subscribers in the year-ago quarter. The company is also working to boost its new ad-supported subscription offering that was introduced last year.
“Engagement on our ad tier has exceeded our initial expectations, and as expected, we’ve seen very little conversion from our standard and premium plans,” the company said in its Tuesday subscriber letter.
Netflix reported revenue of about $8.2 billion in the quarter, up nearly 4% from the same period a year earlier and in line with analysts’ estimates. The company’s quarterly revenue fell 18% to $1.3 billion.
Netflix expects revenue to rise nearly 5% to $8.2 billion in the three months ended June, but expects quarterly profit to fall more than 19% from the same period a year earlier.
The report comes days after Netflix looped It was supposed to be its second live show — the Season 4 “Love Is Blind” reunion — and had to apologize to disappointed fans and make a special tape for streaming. Unlike its streaming rivals, Netflix has long resisted live streaming due to its high costs. But, facing steep competition, Netflix began experimenting with a format that has yet to be perfected.
Netflix said Tuesday that it would Officially discontinued The DVD rental service made it a household name this fall.